Authors

Document Type

Source Publication

The factory-free economy : outsourcing, servitization, and the future of industry

Publication Date

5-2017

First Page

111

Last Page

135

Publisher

Oxford University Press

Keywords

Deindustrialisation, Servitization

Abstract

The story of deindustrialization of developed economies is now old and well-observed. In most developed countries, value added by manufacturing as a percentage of GDP has decreased continuously since the 1950's, and is now less than 15% in most OECD countries. The shift of value added and employment away from manufacturing toward services may be even deeper than suggested by data based on sectoral classification. As the complexity and diversity of firms' activities grow, the boundary between services and industries becomes increasingly elusive. This paper uses detailed balance sheet data from a very large panel of French firms to examine the production and the sales of services by manufacturing firms. Our data reveals that 83% of firms registered in manufacturing sectors provide services for third parties, and nearly one-third of these firms provide more services than goods. Additionally, we find that from 1997-2007 manufacturing firms have increased their production of services. This growing trend in "servitization" suggests that deindustrialization, already observed on a country-scale, is also taking place within firms.

Publisher Statement

Additional Information

ISBN of the source publication: 9780198779162

This article also published as Crozet, M., & Milet, E. (2014). The servitization of French manufacturing firms. CEPII Working Paper, (2014-10). France: CEPII. Retrieved from http://www.cepii.fr/PDF_PUB/wp/2014/wp2014-10.pdf